Economy
Ottawa’s cap-and-trade plan long on costs, light on environmental benefits
From the Fraser Institute
” the Trudeau government’s new plan would reduce an already unmeasurable climate benefit to one even less measurable “
On Thursday, the Trudeau government unveiled its plan to cap greenhouse gas emissions from Canada’s oil and gas sector. The plan calls for a “cap-and-trade” system rather than a mandatory hard cap on emissions.
A previous plan would have required the oil and gas sector to reduce emissions by 42 per cent (from 2019 levels) by 2030. The new plan calls for a 35 per cent to 38 per cent cut (again, compared to 2019 levels by 2030). So the government has somewhat softened the target. However, the slight change is unlikely to improve the cost/benefit analysis for the sector or affected provinces.
As noted in a study published earlier this year, the Trudeau government’s previous plan would have resulted in at least $45 billion in revenue losses for the oil and gas sector in 2030 alone, which would imply a significant drop resource royalties and tax revenue for governments. And costs would ripple farther out from the oil and gas sector, into the plastics and petrochemical sectors, imposing more costs and threatening the employment of many Canadian workers in those sectors.
Crucially, according to the study, this economic gain would come with little or no environmental benefit. While the reductions would be large when only considering Canada’s oil and gas sector, the impact on climate change, which is a matter of global GHG concentrations, would be virtually nonexistent. The government’s previous plan called for Canada to reduce GHG emissions by 187 megatonnes in 2030, which would equate to four-tenths of one per cent of global emissions and likely have no impact on the trajectory of the climate in any detectable manner and hence offer equally undetectable environmental, health and safety benefits. In other words, the Trudeau government’s new plan would reduce an already unmeasurable climate benefit to one even less measurable.
And now, there are serious questions if the new plan will deliver even the miniscule climate benefit mentioned above. Under a cap-and-trade scheme, companies can trade in emission offsets if they’re unable to reduce emissions via their own technological processes, and to avoid cutting oil and gas production. But emission offset schemes are deeply dodgy.
As noted in a Guardian investigation of Verra, the world’s leading offset market—basically, organizations that reduce carbon in the atmosphere by tree-planting and other initiatives—more than 90 per cent of Verra’s rainforest offset credits (among the most commonly used by companies) are likely “phantom credits” and do not represent genuine carbon reductions. And as reported in the ultra-green Grist, rainforest credits are not the only bogus game in town. “In reality… the market for these offsets is ‘riddled with fraud,’ with offset projects too often failing to deliver their promised emission reductions.”
Canada’s domestic carbon offset market may be more robust than in other countries, but there’s no guarantee. If a significant share of Canada’s offsets prove to be as bogus as the international norm, GHG reductions from the oil and gas sector might be smaller still.
The Trudeau government’s new GHG cap on the oil and gas sector is a moderate improvement over the previous plan. The cap is a bit less stringent, and therefore might be easier to attain. And the use of cap-and-trade rather than a hard cap will give the oil and gas industry more flexibility, and more importantly, allow it to avoid curtailing production to satisfy the cap. But the plan still fails a critical cost/benefit analysis. It remains quite high in potential costs for Canada’s oil and gas sector, particularly in provinces which produce the most oil and gas, yet will deliver environmental benefits that are too small to measure.
Author:
From Resource Now
Alberta renews call for West Coast oil pipeline amid shifting federal, geopolitical dynamics.
Just six months ago, talk of resurrecting some version of the Northern Gateway pipeline would have been unthinkable. But with the election of Donald Trump in the U.S. and Mark Carney in Canada, it’s now thinkable.
In fact, Alberta Premier Danielle Smith seems to be making Northern Gateway 2.0 a top priority and a condition for Alberta staying within the Canadian confederation and supporting Mark Carney’s vision of making Canada an Energy superpower. Thanks to Donald Trump threatening Canadian sovereignty and its economy, there has been a noticeable zeitgeist shift in Canada. There is growing support for the idea of leveraging Canada’s natural resources and diversifying export markets to make it less vulnerable to an unpredictable southern neighbour.
“I think the world has changed dramatically since Donald Trump got elected in November,” Smith said at a keynote address Wednesday at the Global Energy Show Canada in Calgary. “I think that’s changed the national conversation.” Smith said she has been encouraged by the tack Carney has taken since being elected Prime Minister, and hopes to see real action from Ottawa in the coming months to address what Smith said is serious encumbrances to Alberta’s oil sector, including Bill C-69, an oil and gas emissions cap and a West Coast tanker oil ban. “I’m going to give him some time to work with us and I’m going to be optimistic,” Smith said. Removing the West Coast moratorium on oil tankers would be the first step needed to building a new oil pipeline line from Alberta to Prince Rupert. “We cannot build a pipeline to the west coast if there is a tanker ban,” Smith said. The next step would be getting First Nations on board. “Indigenous peoples have been shut out of the energy economy for generations, and we are now putting them at the heart of it,” Smith said.
Alberta currently produces about 4.3 million barrels of oil per day. Had the Northern Gateway, Keystone XL and Energy East pipelines been built, Alberta could now be producing and exporting an additional 2.5 million barrels of oil per day. The original Northern Gateway Pipeline — killed outright by the Justin Trudeau government — would have terminated in Kitimat. Smith is now talking about a pipeline that would terminate in Prince Rupert. This may obviate some of the concerns that Kitimat posed with oil tankers negotiating Douglas Channel, and their potential impacts on the marine environment.
One of the biggest hurdles to a pipeline to Prince Rupert may be B.C. Premier David Eby. The B.C. NDP government has a history of opposing oil pipelines with tooth and nail. Asked in a fireside chat by Peter Mansbridge how she would get around the B.C. problem, Smith confidently said: “I’ll convince David Eby.”
“I’m sensitive to the issues that were raised before,” she added. One of those concerns was emissions. But the Alberta government and oil industry has struck a grand bargain with Ottawa: pipelines for emissions abatement through carbon capture and storage.
The industry and government propose multi-billion investments in CCUS. The Pathways Alliance project alone represents an investment of $10 to $20 billion. Smith noted that there is no economic value in pumping CO2 underground. It only becomes economically viable if the tradeoff is greater production and export capacity for Alberta oil. “If you couple it with a million-barrel-per-day pipeline, well that allows you $20 billion worth of revenue year after year,” she said. “All of a sudden a $20 billion cost to have to decarbonize, it looks a lot more attractive when you have a new source of revenue.” When asked about the Prince Rupert pipeline proposal, Eby has responded that there is currently no proponent, and that it is therefore a bridge to cross when there is actually a proposal. “I think what I’ve heard Premier Eby say is that there is no project and no proponent,” Smith said. “Well, that’s my job. There will be soon. “We’re working very hard on being able to get industry players to realize this time may be different.” “We’re working on getting a proponent and route.”
At a number of sessions during the conference, Mansbridge has repeatedly asked speakers about the Alberta secession movement, and whether it might scare off investment capital. Alberta has been using the threat of secession as a threat if Ottawa does not address some of the province’s long-standing grievances. Smith said she hopes Carney takes it seriously. “I hope the prime minister doesn’t want to test it,” Smith said during a scrum with reporters. “I take it seriously. I have never seen separatist sentiment be as high as it is now. “I’ve also seen it dissipate when Ottawa addresses the concerns Alberta has.” She added that, if Carney wants a true nation-building project to fast-track, she can’t think of a better one than a new West Coast pipeline. “I can’t imagine that there will be another project on the national list that will generate as much revenue, as much GDP, as many high paying jobs as a bitumen pipeline to the coast.”
This article supplied by Troy Media.
Canadians must consider how closer EU ties could erode national control and economic sovereignty
As Prime Minister Mark Carney attempts to deepen Canada’s relationship with the European Union and other supranational institutions, Canadians should be asking a hard question: how much of our national independence are we prepared to give away? If you want a glimpse of what happens when a country loses control over its currency, trade and democratic accountability, you need only look to Bulgaria.
On June 8, 2025, thousands of Bulgarians took to the streets in front of the country’s National Bank. Their message was clear: they want to keep the lev and stop the forced adoption of the euro, scheduled for Jan. 1, 2026.
Bulgaria, a southeastern European country and EU member since 2007, is preparing to join the eurozone—a bloc of 20 countries that share the euro as a common currency. The move would bind Bulgaria to the economic decisions of the European Central Bank, replacing its national currency with one managed from Brussels and Frankfurt.
The protest movement is a vivid example of the tensions that arise when national identity collides with centralized policy-making. It was organized by Vazrazdane, a nationalist, eurosceptic political party that has gained support by opposing what it sees as the erosion of Bulgarian sovereignty through European integration. Similar demonstrations took place in cities across the country.
At the heart of the unrest is a call for democratic accountability. Vazrazdane leader Konstantin Kostadinov appealed directly to EU leaders, arguing that Bulgarians should not be forced into the eurozone without a public vote. He noted that in Italy, referendums on the euro were allowed with support from less than one per cent of citizens, while in Bulgaria, more than 10 per cent calling for a referendum have been ignored.
Protesters warned that abandoning the lev without a public vote would amount to a betrayal of democracy. “If there is no lev, there is no Bulgaria,” some chanted. For them, the lev is not just a currency: it is a symbol of national independence.
Their fears are not unfounded. Across the eurozone, several countries have experienced higher prices and reduced purchasing power after adopting the euro. The loss of domestic control over monetary policy has led to economic decisions being dictated from afar. Inflation, declining living standards and external dependency are real concerns.
Canada is not Bulgaria. But it is not immune to the same dynamics. Through trade agreements, regulatory convergence and global commitments, Canada has already surrendered meaningful control over its economy and borders. Canadians rarely debate these trade-offs publicly, and almost never vote on them directly.
Carney, a former central banker with deep ties to global finance, has made clear his intention to align more closely with the European Union on economic and security matters. While partnership is not inherently wrong, it must come with strong democratic oversight. Canadians should not allow fundamental shifts in sovereignty to be handed off quietly to international bodies or technocratic elites.
What’s happening in Bulgaria is not just about the euro—it’s about a people demanding the right to chart their own course. Canadians should take note. Sovereignty is not lost in one dramatic act. It erodes incrementally: through treaties we don’t read, agreements we don’t question, and decisions made without our consent.
If democracy and national control still matter to Canadians, they would do well to pay attention.
Isidoros Karderinis was born in Athens, Greece. He is a journalist, foreign press correspondent, economist, novelist and poet. He is accredited by the Greek Ministry of Foreign Affairs as a foreign press correspondent and has built a distinguished career in journalism and literature.
Troy Media empowers Canadian community news outlets by providing independent, insightful analysis and commentary. Our mission is to support local media in helping Canadians stay informed and engaged by delivering reliable content that strengthens community connections and deepens understanding across the country.
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